Apples Mac Halo: No Myth

Opinion: Recent punditry suggests that the "halo effect" between Apple's iPod sales and purchases of Macintosh computers is either dimming or may be just a statistical error. But these industry watchers may be looking in the wrong place

With Windows Vista now in the channel, some analysts predict reversals for Apple. Others now question the so-called "halo effect" of the iPod, the notion that a positive experience with the Apple audio player will lead people to buy a Mac.
I dont buy much of this talk. In fact, I see signs that the Mac will continue its comeback and may be on the threshold of making a greater mark in the business market.
The hubbub was sparked by a Feb. 14 Piper Jaffray report by analyst Gene Munster, which was based on a recent survey of 50 Best Buy retail stores. It was more of a PC survey. The report said that 72 percent of stores found that Vista was driving an interest in new PCs and 29 percent said it wasnt.

Munster warned that these Vista PC sales could result in a dip for Mac sales in the second quarter. But not by much.

Click here to read more about the Piper Jaffray report on Vista and Apple sales.
However, he was confident that over the long term Mac market share will rise. "As the PC market shifts toward portables, Apples market share will benefit from higher share in this category," he told eWEEK.com.
On the other hand, my former colleague Larry Dignan discounted the latest anti-Vista marketing effort from Apple in a Feb. 15 article on Seeking Alpha. In it he also dissed the whole idea of the halo effect.

"If iPod purchases led to new Mac owners Apple would have more market share by now," Dignan said.
But is this survey at Best Buy really the place to measure of the halo effect? Should our expectation be that all Windows customers who own iPods will suddenly awake as if from a dream and run down to the Apple store for a brisk dose of Mac OS X running on a MacBook?
Yet, on some days and in some places, it could appear that way. Apple said in its Jan. 17 quarterly analyst briefing that more than 50 percent of Mac customers in the companys stores were first-time "switchers" from PCs.
Read more here about Apples recent quarterly earnings report.
Certainly, this group of new users reported by Apple must have some iPod customers in the mix. Apple is a public company and must be mostly honest about reporting on its market and sales.
However, this behavior is what I would call a "micro level" expression of the halo effect. I suggest that the iPod and the arrival of Intel-based Macs in the past year have had a more important "macro" influence on the market, with consumers and even with business customers.
While, there were considerable technical and value hurdles that users needed to overcome on the road to switching, the biggest obstacle to Mac adoption was the perception of Apple as a failing company. Apple lived under a sentence of doom by analysts and pundits for many years. It was as if the company was one misstep, one failed product and one quarter away from ruin.
Apples decline in the 1990s (and Microsofts rise) sent the brand into a great hole. And in the general publics eyes, Apple didnt really begin to climb out until the iPod came along.
Of course, the company was sustained during its toughest years by its loyal user base. But Apples recent success with the iPod gave solid proof to the rest of the market (the other 96 percent or so) that the company would be sticking around for a while longer.
The iPod became the engine of respectability that was able to pry the doom monkey off Apples back.
Next Page: Whos switching now?